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Kobo's new color E Ink eReaders start at only $150
(www.pocket-lint.com)
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I used a Hisense A5 Pro CC phone for a few months as my daily driver. For books, colour eink is okay at best but yeah, contrast sucks. It pretty much always will with the extra layers of filtering needed for each colour.
Outside of static pages of text and images, you pretty much need to drop colour depth to pretty garish levels for a decently responsive user experience. It's a nice idea but really isn't very good in practice.